How Much Can You Negotiate on a New Car in Canada?

Walking into a car dealership in Toronto can feel a bit like stepping into a boxing ring. You know you want the best deal, but the salesperson has their own goals. If you are wondering how much can you negotiate on a new car in Canada, you aren’t alone. In 2026, the market has shifted. Gone are the days of “take it or leave it” pricing that we saw during the supply shortages. Today, buyers have power again, if they know how to use it.

At Carrookie, we see this every day. We connect buyers across Canada with top-tier agents who know the ropes, helping people get behind the wheel of their dream car even when their credit isn’t perfect. Whether you’re shopping in the GTA or anywhere else in Ontario, here is how you can stop being a “shopper” and start being a negotiator.

How Much Can You Negotiate on a New Car in 2026?

The short answer is: Yes, you can negotiate new car prices. However, “haggling” doesn’t mean just asking for a random discount. It’s about understanding the margin.

On a standard gas-powered SUV or sedan, there is typically a 3% to 7% markup between what the dealer paid (the invoice price) and the sticker price (MSRP). In the current 2026 market, many buyers are successfully negotiating 2% to 5% off the MSRP, especially on models that have been sitting on the lot for more than 30 days. If you’re looking at luxury brands or high-demand hybrids, that room might be tighter, but there’s almost always a way to shave off some cost.

Read More: Second hand car price calculator

How Do You Negotiate a Car Price Like a Pro?

Negotiation isn’t about being loud; it’s about being prepared. Here is the framework we suggest to our clients at Carrookie to ensure they don’t leave money on the table.

1. Research the “Invoice Price”

Don’t start your math at the MSRP. Use tools like Unhaggle or CarCostCanada to find out what the dealer actually paid for the car. If you know the dealer has $3,000 of “profit room” in a car, asking for $1,500 off feels reasonable to them, whereas asking for $5,000 off just ends the conversation.

2. Negotiate the “Out-the-Door” Price

Dealers love to talk about “monthly payments.” Why? Because they can hide high interest rates or long 84-month terms inside a small monthly number. Can you negotiate new car prices effectively if you only talk about payments? No. Always insist on discussing the total “out-the-door” price, including all taxes and fees. Once you agree on the total price, then you can talk about how to pay for it.

Read More: Tax on a Car in Ontario

3. Use Timing to Your Advantage

Dealerships have quotas. If you walk in on a rainy Tuesday during the last three days of the month, the sales team is likely scrambling to hit their targets. They are much more likely to accept a lower offer just to get another “unit” on the board for the month.

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4. Be Ready to Walk Away

This is your greatest superpower. If a dealer in Toronto won’t budge on a high “documentation fee” or won’t meet your target price, stand up and thank them for their time. Often, you’ll get a phone call before you even make it back to the 401 with a “revised” offer.

Read more: How to Pick a vehicle in Toronto?

Why Credit Shouldn’t Stop Your Negotiation

A common mistake people make is thinking that because their credit score isn’t a perfect 800, they have no right to negotiate. That’s simply not true.

At Carrookie, we specialize in helping Canadians with all types of credit backgrounds. A dealership still wants to move inventory, and a sale is a sale. By getting pre-approved or working with experts like our team, you show the dealer you are a serious buyer, which gives you leverage regardless of your credit history.

FAQs

Is the "Freight and PDI" fee negotiable in Ontario?

Usually, no. Freight and PDI (Pre-Delivery Inspection) are set by the manufacturer. However, while you can’t change the fee itself, you can ask for a discount on the car’s price that effectively offsets that cost.

Can I negotiate the value of my trade-in separately?

Always. Treat your new car purchase and your trade-in as two completely different deals. Don’t let the dealer “bundle” them, as they might give you a discount on the new car but lowball you on your trade-in to make up the difference.

Are "Dealer Add-ons" like nitrogen in tires or window etching mandatory?

In Ontario, if these weren’t part of the advertised price, they are optional. You can and should tell the dealer you don’t want them. If they say they are already “installed,” tell them you aren’t paying for them.

Can I negotiate a better interest rate at the dealership?

Yes. The “buy rate” the bank gives the dealer is often lower than the rate they offer you. They add a “markup” to the interest. If you have a pre-approval from another lender, show it to them and ask them to beat it.

Does paying cash give me more negotiating power?

Surprisingly, often the opposite is true. Dealers make money on financing commissions. If you tell them you’re paying cash upfront, they might be less willing to drop the car’s price. It’s often better to negotiate the price first before mentioning you’re a cash buyer.